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Frontier Technology and Absorptive Capacity: Evidence from OECD Manufacturing Industries

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  • Richard Kneller
  • Philip Andrew Stevens

Abstract

In this paper, we examine the three facets of technology: its creation, dispersion and absorption. We investigate whether differences in absorptive capacity help to explain cross-country differences in the level of productivity. We utilize stochastic frontier analysis to investigate two potential sources of this inefficiency - differences in human capital and R&D - for nine industries in 12 Organization for Economic Co-operation and Development (OECD) countries over the period 1973-91. We find that inefficiency in production does indeed exist and it depends upon the level of human capital of the country's workforce. Evidence that the amount of R&D an industry undertakes is also important is less robust. Copyright 2006 Blackwell Publishing Ltd.

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Bibliographic Info

Article provided by Department of Economics, University of Oxford in its journal Oxford Bulletin of Economics & Statistics.

Volume (Year): 68 (2006)
Issue (Month): 1 (02)
Pages: 1-21

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Handle: RePEc:bla:obuest:v:68:y:2006:i:1:p:1-21

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